Thiam on the rack if £23.5bn deal collapses

Click to follow
The Independent Online

Tidjane Thiam's days running the Prudential could be numbered if he fails to pull off the takeover of AIA, analysts warned yesterday.

The chief executive is facing criticism after the company was hit with its second major embarrassment since he took over from Mark Tucker last September in a blaze of largely favourable publicity. Eamonn Flanagan, an analyst at Shore Capital, said: "It is not beyond the realms of possibility that Prudential will not reach the 75 per cent support it needs for this transaction, at which point Tidjane will have a job on to keep his position."

Mr Thiam tested investors' patience when it emerged that he was planning to take a second job as a director of the French bank, Société Générale, in the midst of the AIA deal. Under pressure from shareholders, he decided not to accept the position.

Prudential has been criticised for the way the AIA deal was presented. It was announced only months after Mr Thiam moved into the chief executive's chair. Nic Clarke, an analyst at Charles Stanley, said: "This will certainly not help confidence in what they are trying to do, which is pretty gigantic. They need to keep everybody on side as much as possible. Investors were not happy with the SocGen job because there was a real sense that the key person in a deal that is truly transformational could get distracted."

Similar criticisms were levelled at the company after its attempt to take over American General in 2001, another transformational deal that failed. It ultimately cost the then chief executive, Jonathan Bloomer, his job.

Comments